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We had an employee who was having car trouble during the pandemic and once the office opened back up we reailzed that paying for her Uber every day was not sustainable. I agreed to gift her my vehicle, which needed repairs to run safely, with the condition that she use it to get to work. The office agreed to cover the cost of the repairs in order to facilitate her coming to work as well.

The offer was made in May, and with the pandemic delays the repair work was finished in June and I was able to order a duplicate title in July. I was working remotely so I brought the title in and signed it, however we did not agree on date, etc. At that point and she was to leave the title at the office until things had been ironed out.

She had multiple reasons why she was unable to take possession of the vehicle and kept putting it off. I continued to pay for insurance on the vehicle as it physically remained in my possession. She finally told me that she got insurance on the vehicle at the end of August, although at this point her behavior was getting more erratic and her attendance at work was not consistent or reliable for months. I did not believe her and to be safe continued to pay for insurance on the car.

I asked her multiple times when she would take the vehicle and always was told later dates. This past week, she once again called out at the last minute for 3 days straight and then told our office that she would no longer be able to work during the week and wanted to only work on weekends (we are a law office so this was not what she was hired for). After much consideration, we decided we still wanted to help her and agreed that we would come in on the weekends and allow her to work so that she would at least be able to make some money.

However, at this point I informed her that the vehicle was off the table as she had yet to use it to come to work which was the condition of the gift and now she would not be coming to work on the weekdays as previously agreed. She was unhappy about this and told me the car was hers as she had removed the title from the office already. In addition, she never showed up for her shifts the following Saturday and Sunday and also never responded to multiple texts confirming her new schedule and asking her where she was when she was a no show.

At this point we accepted her lack of communication and absences as a resignation and sent her a letter outlining all the facts regarding her employment with us and stating that she was no longer with the company due to her actions. She sent me an email this morning demanding that I set up a time for her to come pick up the car.

What are my legal rights to rescinding this gift offer considering she never fulfilled her side of the agreement and now that she is no longer with the company, it will be impossible for her to meet the conditions of the gift?

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    Interesting that you work for a law office, yet you're asking Internet amateurs for legal advice? We can't give legal advice on specific situations. – Nate Eldredge Oct 5 '20 at 19:08
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    @NateEldredge +1 on the remark "we are a law office". I thought that detail was funny. – Iñaki Viggers Oct 5 '20 at 19:18
  • We don't specialize in contract law and definitely don't have any specialty regarding gifting concerns, mostly just real estate contracts and estate planning. Just because you work in a law office doesn't mean you are an expert in all aspects of the law. Geez. Thanks for the help. – MBD Oct 5 '20 at 19:53
  • I'm just looking for opinions based on these facts. – MBD Oct 5 '20 at 19:54
  • Wow, there's a really interesting legal question here but you had to burry it with a personal situation. – User37849012643 Oct 8 '20 at 20:14
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Can I rescind my conditional gift, which was a vehicle, if the employee is no longer with the company?

Yes, which you already did when you "informed her that the vehicle was off the table".

Rather than a gift, your description reflects that you and the former employee entered a contract regarding that vehicle. The mere fact that one consideration entails a permanent effect (i.e., she would not have to return the vehicle) does not change the fact that the parties' ascertainable intent was an exchange of considerations.

Now termination of her employment frustrates the purpose of that contract. Moreover, since (1) she kept postponing the picking up of the vehicle till you informed her of the withdrawal of your offer, and (2) her attendance did not improve significantly, the contract was voidable by you to the extent that her prior acts (i.e., incurring Uber expenses) misled and induced you to make that offer.

Even if she were in possession of the vehicle already, her erraticism and unreliability suggests that she breached the covenant of good faith and fair dealing that is inherent to all contracts. That would be grounds for rescinding the contract.

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    Thank you for your input! This is my thought as well, but I just wanted to get another opinion on the matter. – MBD Oct 5 '20 at 20:01
  • @MDB "This is my thought as well". Good. Regarding voidable contracts, duty of good faith & fair dealing, and the frustration of the purpose of a contract, see Restatement (Second) of Contracts at §153, §205 and §265, respectively. The Restatement is frequently cited by courts in the U.S. when deciding contract disputes. And the principles of contract law are significantly uniform among "modern" jurisdictions/countries. – Iñaki Viggers Oct 6 '20 at 12:12
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I don't see a gift; I see a contract

I agreed to gift her my vehicle, which needed repairs to run safely, with the condition that she use it to get to work.

Your consideration is that you will transfer the vehicle to her; her consideration is that she will use it to get to work. It is important to note that this contract is independent of (although clearly related to) her employment contract. So, if she had taken possession of the car, driven it to work for 1 day, and given her notice, the car would be hers because she had fulfilled her obligation - she had used it to get to work. Even though the time she had done so was less than you might have expected, it seems that you did not put any restriction on how many times she had to do this.

Your situation is ... more complicated.

Providing you were, at all times, ready, willing, and able to give her the car, then her failure to collect it would not be a breach of the contract by you. Notwithstanding, it is not clear that you have the right to deny her the car even though she cannot complete her side of the contract. If you are right, and that she abandoned her employment, then it would appear to be her breach. However, abandonment of employment is tricky and it is certainly possible, even likely, that she was fired; if so then this is a breach of the contract by you even if the termination was lawful.

Additionally, you say "I continued to pay for insurance on the vehicle as it physically remained in my possession": why? If it's her car, why do you care if she has insurance? By continuing to pay insurance you are continuing to demonstrate that you believe you have a proprietorial interest in the car - that is, you still consider it to be your car. As such, you may have breached the contract by not allowing her to take possession until she demonstrated that she had insured it - I don't see how that was a term of the contract.

Is she entitled to the car? Buggered if I know, it's complicated enough that I'd avoid a lawsuit over it if I could.

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  • "not clear that you have the right to deny her the car". The OP offered the vehicle under "condition that she use it to get to work". She repeatedly declined picking up the car (as part of her absenteeism, erraticism, and unreliability), whence the condition was never met. Now that she has been terminated, the condition can no longer occur. The Restatement (Second) of Contracts at § 225(2) favors the OP because "non-occurrence of a condition discharges the [OP's] duty when the condition can no longer occur" (brackets added). – Iñaki Viggers Oct 6 '20 at 12:29
  • You make an interesting point regarding abandonment of employment... at what point does behavior become abandonment. She was, in my eyes, clearly not trying to keep her job by calling out & not showing up w/ no indication she was planning to call out for 3 days prior to that weekend. – MBD Oct 6 '20 at 15:02
  • Then she demanded that she work only on weekends, a time when the office is not even open, and finally never showed up or communicated why she was not coming on the weekend when we tried to accommodate her. If she wasn't abandoning her job, she was at the very least trying to get fired. Where does the line get drawn in this situation? – MBD Oct 6 '20 at 15:02
  • Additionally, I had made the car available for her to pick up multiple times during the months following July. Every time she had an excuse as to why she wasn't ready to pick up the car. The reason why I kept insurance is that I knew she would also not register the car in her name right away, as was her procrastinating nature, and I was afraid something would happen that might make me liable. I was also making sure it was covered if something happened to the car while still in my possession. Perhaps that was an overabbundance of caution. But intention was always there for her to take it. – MBD Oct 6 '20 at 15:06
  • @MBD abandonment requires that the employer use every reasonable method to contact the employee and discover their intentions; it appears you made assumptions. The absenteeism and change to working hours is not evidence of abandonment because you accepted and accommodated it. You cannot assume abandonment- for example, a person may not turn up to work because they were suddenly hospitalised and unable to communicate. – Dale M Oct 6 '20 at 20:12
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If you want free, specific legal advice on your problem, ask your boss. But as an educational site, we can discuss general principles. As you know, possession is nine-tenths of the law. Suppose we have a situation where a vehicle owner A signs on the relevant line of the title, thereby allowing another person B to take legal ownership of a vehicle: but they do not relinquish physical possession. This is not a federal matter in the US: I assume this is in the US (this is why you have to specify jurisdiction). Being a state matter, I assume this is in Washington state. To legally take possession of the vehicle, I assume that B has all of the relevant documents, with a valid bill of sale and a signed title (and other stuff). You are also supposed to have reported the "sale" (gift) within 5 days, which I bet you didn't do.

Since you did not steal her car, the police will not get involved, instead, she will have to sue you to get possession of the vehicle (she might allege that you did, you can explain the circumstances and the officers will presumably wash their hands of the matter). Now it is simply a matter of determining whether the conditions for the transaction were satisfied. As a contract matter, she did not satisfy the conditions of the agreement, so gets no car. Despite the appearance of this being a gift, it is not a gift, it's an exchange of value for value – just not cash value for you. The point of the contract is that she should be able to make it to work: what's the point of the "gift" otherwise? So the contract is cancelled and A can go about his business.

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  • Thank you! I have asked my boss and we are working things out but this is not his specialty so other points of view are helpful in figuring out our next plan of action. – MBD Oct 5 '20 at 20:49

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